Greetings to all experienced and knowledgeable members present here.
I have recently transitioned from recruitment to HR and am having difficulty understanding labour laws and statutory compliance. Although I\'ve been reading from various online sources, the information seems quite confusing. My company has tasked me with creating the CTC for all 150 employees, which comprises freshers, director level, VP level, developers, etc., and ensuring that the company aligns with all compliance and labour laws.
For the purpose of creating the CTC, I have downloaded an Excel template from CiteHR, but I am still perplexed about how to proceed with the PF and tax deductions. As our company lacks an accountant, I must perform all related tasks independently, and my manager, who is currently on maternity leave, is unavailable to assist.
Our employees are based in Chandigarh and Noida, and some are remote workers. I am seeking guidance on understanding the calculation of PF and TDS, the breakdown of CTC, what can be included, the respective percentages, and how to stay updated on labour laws and statutory compliance. Any assistance would be greatly appreciated.
Acknowledge(0)
Amend(0)
I have recently transitioned from recruitment to HR and am having difficulty understanding labour laws and statutory compliance. Although I\'ve been reading from various online sources, the information seems quite confusing. My company has tasked me with creating the CTC for all 150 employees, which comprises freshers, director level, VP level, developers, etc., and ensuring that the company aligns with all compliance and labour laws.
For the purpose of creating the CTC, I have downloaded an Excel template from CiteHR, but I am still perplexed about how to proceed with the PF and tax deductions. As our company lacks an accountant, I must perform all related tasks independently, and my manager, who is currently on maternity leave, is unavailable to assist.
Our employees are based in Chandigarh and Noida, and some are remote workers. I am seeking guidance on understanding the calculation of PF and TDS, the breakdown of CTC, what can be included, the respective percentages, and how to stay updated on labour laws and statutory compliance. Any assistance would be greatly appreciated.
Acknowledge(0)Amend(0)
Understanding labour laws, statutory compliance, and CTC calculation can indeed be a daunting task, especially when you have to manage it for a diverse employee base. Here's a step-by-step guide to help you navigate through this:
1. Understanding Provident Fund (PF) and Tax Deducted at Source (TDS): As per the Employees' Provident Fund and Miscellaneous Provisions Act, 1952, both the employee and the employer contribute 12% of the basic salary towards PF. For TDS, the Income Tax Act, 1961 applies. TDS is deducted based on the employee's income slab. You can refer to the official https://www.incometaxindia.gov.in/Pages/default.aspx for the latest tax slabs.
2. Breakdown of CTC: CTC includes basic salary, house rent allowance, dearness allowance, conveyance allowance, medical allowance, special allowances, and employer's contribution to PF and ESI. The percentages may vary based on the company's policy, but the basic salary is usually 40-50% of the CTC.
3. Staying Updated on Labour Laws and Statutory Compliance: You can subscribe to HR newsletters, join HR forums, and follow government websites to stay updated on changes in labour laws and statutory compliance. Websites like https://labour.gov.in/ and https://www.epfindia.gov.in are quite helpful.
4. Handling Diverse Employee Base: For employees at different levels, the components of the CTC may vary. For instance, senior-level employees may have components like gratuity, leave travel allowance, and bonuses included in their CTC.
5. Managing Remote Workers: For remote workers, you may need to consider additional components like internet allowance, home office setup allowance, etc. in their CTC.
Remember, it's crucial to maintain transparency with your employees about their CTC structure. This not only builds trust but also ensures that they have a clear understanding of their earnings and deductions.
From India, Gurugram
Acknowledge(0)Amend(0)
1301. Understanding Provident Fund (PF) and Tax Deducted at Source (TDS): As per the Employees' Provident Fund and Miscellaneous Provisions Act, 1952, both the employee and the employer contribute 12% of the basic salary towards PF. For TDS, the Income Tax Act, 1961 applies. TDS is deducted based on the employee's income slab. You can refer to the official https://www.incometaxindia.gov.in/Pages/default.aspx for the latest tax slabs.
2. Breakdown of CTC: CTC includes basic salary, house rent allowance, dearness allowance, conveyance allowance, medical allowance, special allowances, and employer's contribution to PF and ESI. The percentages may vary based on the company's policy, but the basic salary is usually 40-50% of the CTC.
3. Staying Updated on Labour Laws and Statutory Compliance: You can subscribe to HR newsletters, join HR forums, and follow government websites to stay updated on changes in labour laws and statutory compliance. Websites like https://labour.gov.in/ and https://www.epfindia.gov.in are quite helpful.
4. Handling Diverse Employee Base: For employees at different levels, the components of the CTC may vary. For instance, senior-level employees may have components like gratuity, leave travel allowance, and bonuses included in their CTC.
5. Managing Remote Workers: For remote workers, you may need to consider additional components like internet allowance, home office setup allowance, etc. in their CTC.
Remember, it's crucial to maintain transparency with your employees about their CTC structure. This not only builds trust but also ensures that they have a clear understanding of their earnings and deductions.
From India, Gurugram
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
STATUTORY COMPLIANCES CHECKLIST ON VARIOUS LABOUR LAWS.xls
Labour laws compliance.doc
Compliance of labour laws.pdf
Dhiraj-mishra
ThanksCiteHR.AI
(Fact Checked)-Your advice is spot on! Consulting an HR expert can indeed provide valuable insights for complex tasks like CTC calculation and compliance adherence. (1 Acknowledge point)